Purnells

	Two types of CVA
	what are the two types? why two types? who can apply for a new type of CVA? are their different rules? when would an old type CVA be used? when would a new type of CVA be used?
	Old type CVA - No Moratorium the limbo period nominees duties disclosure issues directors duties the proposal impact of proposal on various parties
	New type CVA - With Moratorium enormous power enormous responsibility disclosure issues impact of proposal nominees duties creditors meeting voting rights supervisors duties a typical proposal costs concluding the CVA banks and debenture holders landlords petitioning creditors preferential creditors unsecured creditors
	Table of differences table to show the differences between the two types of CVA?
	Administration Order v CVA when would administration be sought rather than take up a new type CVA?
	Case Studies case study 1 case study 2 case study 3

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The law is changing fast.We know that the new type CVA became available from the 1st January 2003.

But also "preferential creditors" (or most classes of them) are being abolished as soon as the relevant section of the Enterprise Act 2002 is brought into force.

Inevitably with the VAT office and Tax office losing their right to be preferential creditors it can be expected that their enforcement procedures will be tightened up.

What can we expect for the future?

A trend is already apparent of the VAT office seeking bonds in respect of directors seeking to set up a phoenix company.
The VAT and Tax office can be expected to distrain earlier than they otherwise would have.
Can we expect to see Customs & Excise and The Inland Revenue seeking to take out debentures over the assets of a company?
Will those two departments seek "direct debit" authorities?

These government departments properly recognise that their distraint power has been materially curtailed. When a new type CVA is proposed from 1-1-2003 the moratorium period results in the fact that any distraint cannot be either exercised or continued.